If we want a system that encourages adding new and casual players I think that should be promoted rather than putting an excessive decay on players in small guilds.
1) Don't count accounts without a character above level 16 towards the activity count.
2) Give a very large bonus for adding new players, but only players that don't have a character above 10 on their account.
3) Base decay solely on accounts that have at least one level 16 character
4) Don't count characters that logged in but didn't actually earn any renown for the guild
5) 100% penalty for booting a player
6) Don't remove any renown for players that leave on good terms. If it's not the guild's fault, why should they be penalized because someone decided to move to a large guild where leveling is so easy.